Construction spending remains pretty flat as the March index inched up 0.3%. Construction spending is 9.1% higher than the same period in 2015. Private construction spending posted a slight gain while public construction fell in March.

Private non-residential construction climbed 0.7% in March while residential spending rose 1.6% in March. Despite the decline on the private side, educational and highway spending did climb 0.4%.

Private spending in lodging rose 1.6% and is 28.8% over 2015; commercial grew 0.8% and is 13.2% higher than a year ago; and manufacturing jumped 2.2% in March, but still lags -0.2% below spending in 2015. Office construction fell in March by -0.8%; however, it is 23.9% above 2015.

Disappointing GDP in Q1

As the first quarter closed, GDP remained flat, posting a 0.5% increase over the end of 2015. In the 4th quarter of 2015, GDP increased by 1.4%.

The increase in real GDP in the first quarter reflected positive contributions from personal consumption expenditures (PCE) at a slower than expected rate, residential fixed investment, and state and local government spending. Spending in nonresidential fixed investment, private inventory and federal government spending all fell in the first quarter. Exports decreased while imports increased negatively affected GDP as well.

In the first quarter, investment in nonresidential structures fell -10.7%, and equipment dropped -8.6%. Residential fixed investment grew 14.8%. Personal consumption spending continued to rise, but did so at a much slower rate over the past 6 months.